BAKER LAKE - Cumberland Resources and its Meadowbank property are on the way to being sold to an international mining company based in Ontario.

Agnico-Eagle Mines, of Toronto, plans to buy Cumberland Resources through a share exchange valued at $710 million, said Sean Boyd, Agnico-Eagle vice-chairman and the company's chief executive officer.

Cumberland's board of directors has approved the friendly takeover and now awaits shareholders' approval, he said.

The biggest nugget in the deal is Cumberland's Meadowbank gold project, located in 70 km from Baker Lake.

"We want to take it to the next level and we saw an opportunity to bring it to that," he said.

Agnico-Eagle's Laronde gold mine in Northern Quebec has operated for 25 years and the company is focused on potential long-term mining at Meadowbank, he said.

"We want to get into a position involving communities in Nunavut," he said.

"It's important for the region to bring in an experienced company."

Meadowbank received its approvals from Jim Prentice, the minister of Indian and Northern Affairs Canada, and the Nunavut Impact Review Board several months ago. It is also permitted to build an all weather road from Baker to the mine site.

Cumberland had expected to begin production in 2009.

If the sale goes through as expected, production will be delayed until 2010, he said.

Agnico-Eagle estimates it would spend $375 million before production and $65 million during eight years of operation, he said.

The company plans to increase daily production by 13 per cent from 7,500 tonnes per day to 8,500 tonnes, he said.

Cumberland president and chief executive officer, Kerry Curtis states the potential purchase is a win-win situation.

"The Meadowbank project will be in the good hands of a proven mine builder in Agnico-Eagle, and they have the financial capacity and expertise to continue to expand the reserves and resources of the project," he said.

"I am also confident that Agnico-Eagle will continue to adhere to the highest standards of corporate responsibility, and will work very closely with the community of Baker Lake, the regional Inuit organizations and the Government of Nunavut."

The total workforce is still expected to be about 350 once in production, said Boyd.

"There will be an emphasis on maintaining as many local workers as possible," he said.

Baker Mayor David Aksawnee and MLA David Simailak were both unavailable for comment at press time.

Work on the all weather road to Meadowbank will continue and Agnico-Eagle plans to expand exploration work at the property's Cannu and Goose Island zones this spring.

Agnico-Eagle operates

Canada's largest producing gold mine in Laronde, Que., and is involved in exploration activity throughout the world.